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March 25, 2013

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Ideas, frustrations abound in battling urban tailpipes

THIS winter's choking smog in vehicle-clogged cities in China must be weighing heavily on the minds of those with responsibility for cleaning up the air.

Despite all efforts to restrict car purchases and use, to tighten emissions standards, to get old cars off the road and to encourage green transport alternatives, car fumes remain a principal cause of the deadly haze that blanketed Beijing and other cities.

Among cities where measure-ments of the density of hazardous airborne particulates (PM2.5) went off the charts, Beijing found nearly a quarter of them came from tailpipe emissions, while Xi'an, capital city of Shaanxi Province, reckoned that the proportion was almost a third.

There may be plenty of convenient explanations why it's so hard for Chinese authorities to control vehicular pollution.

On the heels of economic development, the nation's vehicle ownership soared 30 times in the past 32 years, increasing emissions levels 14-fold, according to the Ministry of Environmental Protection. Car ownership has become a public passion that shows no signs of letting up.

More vehicles equal more gasoline and diesel consumption, but national fuel-quality standards have remained rather lax in controlling high sulfur content.

A serious rethink of public policy toward air quality needs to be undertaken before everyone in China is left gasping for breath.

The nation's current restrictions on car purchases and car use look serious enough on paper, but do accomplish the stated goals?

Auctions and lotteries for license plates in cities like Beijing, Shanghai, Guangzhou of Guandong Province have helped ease the number of new cars coming onto already congested roadways. But a hard-won chance to buy one car is pushing plate winners to go whole hog and purchase the best car they can afford - which usually means a bigger, more polluting vehicle.

Last year, the number of newly registered compact and mini-cars in Shanghai declined, while that of bigger, luxury models gained 14 percent. Gas-guzzling sports utility vehicles surged 35.6 percent in registration.

To many people, it seems rather unfair to include cars manufactured under stricter vehicle emissions standards in the restrictions on license plates.

Relatively developed auto markets, like Shanghai and Guangzhou, have upgraded from National I to National IV standards over the past decade, cutting the pollution quotient of each car up to 50 percent with every higher notch. Last month, Beijing became the first in China to enforce the fifth and so far strictest stage of its vehicle emissions standards, known as Beijing V. That aims to reduce new car discharges by another 40 percent.

It remains to be seen how much the new standard will mitigate the capital's chronically bad air, especially since all cars are under traffic controls there, based on the last digit of their license plate numbers and not on their displacement or fuel efficiency.

With smog-fighting now part of life in China, such "indiscriminate attacks" on vehicles have extended to many smaller cities, which adopt big-city standards as part of their emergency protocols. A national lawmaker has even suggested that China draw a red line under vehicle volumes and issue quotas to each city.

Isn't it time to stop and consider a more basic question in the issue of car-exhaust: Do we simply want fewer new cars on the roads of China, or should we be taking the biggest polluting vehicles off the streets?



The Ministry of Environmental Protection, in its latest annual report, said that cars meeting National III emission standard or above comprise more than half the cars on the road but account for less than 25 percent of discharge pollution. The 9.5 percent of cars that fall below the minimum National I standard cause more than 40 percent of the country's vehicle pollutants.

China's "cash-for-clunkers" program ended in 2010. At present, policy has shifted to promoting sales of new fuel-efficient models rather than eliminating high-emission clunkers.

Modest subsidies have been available on purchases of small-displacement passenger vehicles in China, but the nationwide program aimed at removing old polluters now targets only commercial vehicles. In that category, the subsidy for more environmentally friendly city buses was pared recently so that small buses now get only 11,000 yuan (US$1,746) instead of the 18,000 yuan once available to all buses.

Compared with an 8 percent scrappage ratio in developed auto markets, China reportedly disposes of only 3 percent of its total registered vehicles each year. And even that might be an overstatement, given the rampant illegal recycling of end-of-life cars in the country.

Market research firm Ipsos estimates that about 60 percent of cars written off in China don't end up on the scrap heap. Rather, they get makeovers and find their way to rural and remote areas through the black market, with falsified transaction and registration documents.

The central government should establish a more integrated car registration system for tracking the lives of vehicles. But that goal faces an even bigger challenge - forcing more cross-regional cooperation.

With each province looking out for its own interests, handling old cars is a matter more of relocation than disappearance. Cars are on the move, and so is smog. Winds that carry pollution clouds are no respecters of provinces. China first needs to crack self-preservation politics because it weakens rather than empowers everyone.

The country's new green car initiative is now stalled.

Two years after trying to attract consumers with green incentives, the central government failed to meet its target of putting at least 20,000 all-electric or plug-in hybrid cars on the roads of each pilot city by last year, let alone the target of having 10 percent of Chinese car market powered by electricity.

One obstacle is the regional trade barrier erected by cities bent on protecting their own green car industries. Local subsidies are often limited to locally-produced electric cars, and out-of-town candidates are eliminated for supplying public green fleets.

Without free and fair competition, this emerging industry is struggling. And with manufacturing localization as the unwritten rule for entry into the market, the expansion of regional electric vehicle or battery producers inevitably comes at the cost of investment efficiency.

China has only around 27,000 new energy vehicles on the roads at present, with plans to develop and deploy 5 million of the cars by 2020.

Critics argue that government policies put too many eggs in one basket. The choices for green transport are broader than electric cars: hybrids, natural gas, ethanol and methanol vehicles, to name a few alternatives largely being ignored. China is seeking to become the global center of electric car-making at its own peril.

When electric vehicles were pushed out of the market by the internal- combustion engine in the early 20th century, the change came largely because the discovery of massive oil fields across the world made electricity less cost-effective.

Market forces will determine what is most cost-friendly in the future and China needs to recognize and track the trends. It needs to tap diverse energy resources and encourage multiple solutions.

This winter's smog has been a startling shot across the bow. The public does not want to contemplate a future where phrases like "air-pocalypse" become the daily norm.

So where do we go from here?

Upgrading national vehicle emissions standards is a tough choice for policymakers in China, especially when they have so many other critical issues to address.

After more than two years' delay, the nationwide rollout of China's fourth stage of diesel-vehicle emission standards may be put on hold until 2014.

The next stage of standards for diesel, National V, will be announced in June while the National V standard for gasoline will come out before the end of this year. But both won't take effect until 2017.

This is not unusual in China. Domestic refiners and carmakers, so the argument goes, need time to bring their products up to new standards.

But auto manufacturers must have been caught off guard when the Beijing V standard suddenly came into effect ahead of the National V in the smog-bound national capital last month. While joint-venture carmakers were upgrading their models smoothly in Beijing, domestic brands found only 10 percent of their cars met the new requirements and some had no qualified models at all.

Li Shufu, president of China's domestic carmaker Geely, said he welcomed tighter standards but rued the timing.

"They give foreign carmakers an edge because they have technologies that domestic brands don't," he said. "The emission standard and its date of implementation should have been released in advance. That's how competition can be fair for the domestic brands. Otherwise, it is harmful."

Luckily, the focal point of many domestic carmakers has not been Beijing, where restrictions on new license plates have meant cheaper domestic models falling out of favor. Some domestic brands that cannot afford to upgrade their cars for only one market are reportedly turning their sales focus elsewhere.

But it's only a matter of time before stricter environmental regulations expand to wider markets. It would seem prudent for domestic car manufacturers to take the bit between their teeth now rather than muddle along looking for the least-restrictive markets.




 

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